Nigeria:Senate Approves President Tinubu’s ₦1.767 Trillion External Loan Request to Boost Foreign Reserves.

By Aminu Adamu

The Nigerian Senate has approved President Bola Ahmed Tinubu's request to secure an external loan of ₦1.767 trillion (approximately $2.2 billion). The decision, announced on Tuesday, comes amid efforts to bolster the nation's foreign reserves and address the deficit in the 2024 budget.
Chairman of the Senate Committee on Local and Foreign Debt, Senator Aliyu Wamakko, presented the committee's report recommending the approval of the loan request. Speaking during the Senate plenary, Wamakko emphasized the importance of the loan in stabilizing Nigeria's economy and enhancing its financial standing.
“The loan will provide critical support for our foreign reserves and address the significant financing gaps in the 2024 budget,” Wamakko stated. He added that the Senate's decision was informed by the strategic necessity of maintaining the country’s economic stability while ensuring fiscal discipline.
President Tinubu had previously written to the National Assembly, outlining his administration's rationale for seeking the loan. In his letter, Tinubu highlighted the pressing need to address the ₦9.17 trillion budget deficit for the 2024 fiscal year, which the loan is expected to partially finance.
“In light of our fiscal challenges, this loan is a vital instrument to ensure the effective implementation of the 2024 budget. It is part of our broader strategy to stimulate economic recovery and lay a solid foundation for sustainable growth,” the President's letter stated.
The approved loan is expected to be sourced from various international financial institutions, with favorable terms to minimize the debt burden on Nigeria. Lawmakers underscored the need for transparency and accountability in utilizing the funds to achieve the intended objectives.
Senate President Godswill Akpabio, in his remarks, noted that while the approval was necessary, the government must take measures to ensure that borrowed funds are used judiciously. “This Senate is committed to supporting policies that advance Nigeria’s economic interests. However, we urge the executive to prioritize projects that will generate tangible returns and address the critical needs of our citizens,” Akpabio said.
The loan approval has sparked mixed reactions from economic analysts and stakeholders. Supporters argue that the move is a necessary step to stabilize the economy and bridge funding gaps, while critics have raised concerns about Nigeria’s rising debt profile and its long-term implications.
A breakdown of the 2024 budget shows that the ₦9.17 trillion deficit accounts for a significant portion of the total expenditure plan. The approved external loan will complement domestic borrowing and revenue-generation efforts aimed at closing the gap.
As the government prepares to secure the loan, the Senate has called for regular updates on its utilization and impact. “This is not just about borrowing; it is about ensuring that every kobo is spent wisely and delivers measurable benefits to the Nigerian people,” Senator Wamakko reiterated.
The Senate’s decision marks a pivotal moment in Nigeria’s fiscal policy as the government grapples with balancing economic recovery with sustainable debt management.